Collecting debt from another business can be tricky. Your goal is to recover your revenue without damaging important business relationships or hurting your reputation. Other companies may hesitate to do business with a company that harasses other companies over unpaid invoices.
However, it’s also important to act
quickly. Statistics suggest that debt grows more difficult to recover with
time. If the business that owes you money is in financial strife, then other
creditors may beat you to the punch.
It’s usually better to use an agency than rely on an in-house collection department, which usually doesn’t have the same experience or resources. And instead of hiring a consumer collections agency, your business should look for corporate debt collection services from a company that knows how to get the job done. Here are a few signs of a good commercial collection agency:
#1 They Have a Good Record
There are nearly 8,000 debt collection agencies in the United States. With so many choices, it’s important to find the right agency. If they mishandle your account, the debt may become irrecoverable. Partner with a business to business collection agency that has a proven track record of success.
#2 They’re Experienced
Every industry requires a different
strategy for successful debt recovery. Partner with a commercial collection
agency that serves a broad range of industries. Their experience with your
industry will improve the chances of a successful recovery.
#3 They Can Report Businesses to Credit Bureaus
Partner with an agency that has the power to report a business to the credit bureaus. Remember, businesses have credit scores too. A business credit score helps it secure financial loans and maintain a good financial record. Because of the value of this score, many businesses clear their debts when a reputable commercial collection agency is involved.
#4 They Take A Diplomatic Approach
Partner with a commercial collection agency that takes a friendly, ethical, and diplomatic approach to debt collection. Remember, they’re representing your brand. Avoid agencies that use shady tactics. Partnering with such agencies can result in legal problems and do irreparable harm to your company’s reputation.
Fortunately, there are corporate debt
collection agencies that are highly effective and treat debtors with respect. Such agencies convince debtors into
clearing their dues without breaking the rules.
#5 They’re Transparent
A collection agency that treats debtors
with respect is also likely to treat you with respect by being upfront about
their rates and not demanding a mandatory number of accounts. Look for a
company that gives you regular updates through email or their website and
assigns a case manager to you to answer any questions or concerns.
#6 They Can Litigate
Although many commercial debts are
recovered through regular means, some require legal action. Partner with a debt
collection agency that has the resources to conduct financial investigations to determine the value
of pursuing legal action. Such an agency should also have a legal department
that’s experienced at recovering debt through litigation.
These are six signs
of a good commercial collection agency. Partnering with an inexperienced agency
may force you to write off the debt. But with the right team on your side, you
can finally collect the money you’re owed.